G.R. No. 189358 - Centennial Guarantee Assurance Corp. vs. Universal Motors Corp.

Petitioner, Victor A. Custodio, was employed for almost seventeen (17) years by private respondent, First Farmers Milling and Marketing Cooperative Association, Inc., holding the position of Assistant General Manager for Operations, the second highest official in the company.
He earned a monthly salary of ₱10,700 plus allowances (₱500 monthly allowance, ₱400 monthly housing allowance), a Christmas bonus equivalent to one month’s salary, a milling bonus of at least ₱50,000, and other benefits amounting to an approximate annual compensation of not less than ₱200,000.

In 1981, the board of directors decided to purchase a multi-million-peso boiler, and an evaluation committee was formed with petitioner as chairman.
Dispute arose between petitioner and the general manager, Fernando Cuenca, regarding the recommended brand of boiler, which involved contrary claims about kickbacks or commissions allegedly given by suppliers to officers and directors.

Petitioner submitted his letter of resignation on May 5, 1981, which stated that he was taking a one-month vacation starting May 7 and would resign irrevocably after serving the 30-day notice and turnover period.
The board of directors deferred immediate action on the resignation in its May 8, 1981 meeting and summoned petitioner to explain his reasons in a May 13, 1981 meeting.

At the May 13 meeting, petitioner verbally withdrew his resignation and promised to send a letter confirming this withdrawal.

The resignation was revisited in the subsequent May 30, 1981 board meeting where minutes revealed:

Mention that the letter was “irrevocable.”
A statement by Mr. Romeo Guanzon suggesting that the resignation was made under pressure and thus not voluntary or valid.
Petitioner’s expressed intention to withdraw his resignation, although no formal withdrawal letter was received at that time.

On June 3, 1981, Cuenca directed petitioner to desist from assuming his managerial functions after his vacation.
On June 5, 1981, petitioner replied with a letter affirming that he had already withdrawn his resignation, indicating his intention to resume work.
Petitioner reported back to work on June 7, 1981.
On June 8, 1981, Cuenca notified suppliers that petitioner was no longer connected with the cooperative, and on June 10, 1981, petitioner filed a complaint for illegal dismissal with the Ministry of Labor and Employment (MOLE) (LRD Case No. SI-8453-81).

The board revisited the resignation issue in their June 11, 1981 meeting, discussing:

The clarified minutes of both the May 13 and May 30 meetings.
A resolution indicating that actions by Cuenca and petitioner were done in their private capacity, implying petitioner was still connected with the cooperative.

On June 30, 1981, the cooperative reported petitioner’s resignation to the MOLE despite prior indications of withdrawal.

The investigating officer in the MOLE recommended reinstatement with backwages.
However, Assistant Regional Director Dante Ardivilla, on August 10, 1981, ordered the dismissal of petitioner’s complaint, a decision later affirmed by Deputy Minister Vicente Leogardo, Jr. on August 27, 1982, and upon reconsideration on April 18, 1983.
Petitioner’s case, initially dismissed on July 13, 1983, was reconsidered on July 2, 1984 after motions and submissions from the parties.
After several years of dormancy and multiple motions for an early resolution, the case was finally submitted for deliberation on April 4, 1990, with both parties confirming that supervening events had not rendered the case moot.

The controversy centered on whether petitioner’s resignation ever took effect.
Petitioner argued that his effective withdrawal of the resignation during the May 13, 1981 board meeting and his subsequent actions (not serving the required notice, reporting back to work, and filing a complaint for illegal dismissal) demonstrated that the resignation was never effective.
The private respondent contended that the resignation was “irrevocable” as stated in the resignation letter and should thus be accorded full effect regardless of the withdrawal.

Whether petitioner’s effective withdrawal of his resignation at the board meeting of May 13, 1981, along with subsequent actions, negated the “irrevocable” term used in his resignation letter.

Did the facts and procedural posture of the case support the claim that the resignation never took effect?
Was there sufficient evidence showing that petitioner did not intend to sever his employment relationship permanently?

Whether the board and the general manager’s subsequent actions, including referring to the resignation as “irrevocable” and notifying third parties (such as suppliers) of petitioner’s separation, could override the expressed intentions of the petitioner during the May 13, 1981 meeting.

Which act should prevail: the board’s later emphasis on the “irrevocable” nature of the resignation or petitioner’s clear withdrawal of the resignation expressed verbally and in his communications?

Whether the decision of the Ministry of Labor and Employment, initially dismissing the complaint for illegal dismissal, should be set aside in favor of petitioner’s claim for reinstatement with backwages (or separation pay given the lapse of time).